FCA sets out how it will investigate mortgage panels

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The FCA has set out the scope of its investigation into how mortgage panel arrangements hurt competition and consumer choice.

The regulator outlined its plans in May to examine competition in the market, including how consumers assess products, the impact of regulation and commercial relationships across the mortgage market.

Speaking at an FSE event in London today, FCA head of competition Deb Jones said the regulator would investigate the issue as part of its terms of reference ahead of publishing a formal study towards the end of the year.

She said the FCA was interested in the impact of panel and other commercial arrangements between lenders, brokers and other firms in the mortgage supply chain.

The regulator will also review possible conflicts of interest and how these could cause barriers to entry, harm competition and affect consumer choice.

Jones says: “We want to explore how commercial arrangements operate. We recognise the benefits these bring in the sector. We are not looking to tear anything up but we want to look at the pros and cons and see how that stacks up in the interests of the consumer.”

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As part of the study, the FCA will also  look at whether consumers who buy mortgages through brokers have a different outcome to those who go direct.